Thursday Morning Reads

Bulls and the bears

Some Wall Street heavyweights are sounding the alarm over stock prices, saying the risk-reward of holding shares is the worst they've seen in years. Over the last few days, Stan Druckenmiller has called a V-shaped recovery a "fantasy," while David Tepper said that next to 1999, equities are overvalued the most he's ever seen (but doesn't expect the market to retest the bottom). Others, like Bill Miller, aren't buying the sentiment, and don't see the market as "dramatically overvalued."

'Uncertainties remain' in the oil industry

Market forces have "demonstrated their power" in recent weeks, according to the IEA, but a resurgence of coronavirus cases will have "major consequences." In its closely-watched monthly report, crude demand showed a fall of 8.6M bpd to 91.2M for 2020, while on the supply side, it expected a "spectacular" fall of 12M bpd this month, falling to a nine-year low of 88M. Executive Director Fatih Birol said it will take more than a year, and perhaps several, for oil demand to recover to what it was before the coronavirus pandemic.

High court tosses stay-at-home order

While lockdown orders have been challenged across several states, the latest decision from Wisconsin marks the first such lawsuit to succeed against a broader political debate taking place across the nation. In a 4-3 ruling, the Wisconsin Supreme Court struck down the state's stay-at-home order as "unlawful, invalid, and unenforceable" and said the state's health secretary exceeded her authority. The order, which had been set to run until May 26, also restricted travel and business, along with threatening jail time or fines for those who don't comply.

Return to work dilemma

Tesla (NASDAQ:TSLA) CEO Elon Musk has said staff should stay at home if they feel uncomfortable returning to work, but the latest company email puts workers at a crossroads. "Once you are called back, you will no longer be on furlough so if you choose not to work, it may impact your unemployment benefits as determined by your local government agency – and not by Tesla. We completely respect your decision and will support you, without any penalties from us," read an email from HR boss Valerie Workman. Police visited Tesla's Fremont plant on Wednesday to assess whether the EV maker was adhering to "reopening" safety protocols agreed to with Alameda County.

Vaccine priority access

It would be "unacceptable" for French pharma giant Sanofi (NASDAQ:SNY) to reserve any COVID-19 vaccine for the U.S. first, after the firm's chief said he would give preference to the American market because "it's invested in taking the risk." "For us, it would be unacceptable for there to be privileged access to such and such a country for financial reasons," deputy finance minister Agnes Pannier-Runacher told Sud Radio. In April, Sanofi joined with Britain's GlaxoSmithKline (NYSE:GSK) to work on the vaccine, though trials have not even started.

Pexip paves way for virtual IPOs

With video communication on many investors' minds, shares in Norway's Pexip soared by 54% this morning on the Oslo Stock Exchange, following an IPO that was more than 12 times oversubscribed. "The fact that 100% of the virtual 1-1 meetings on the roadshow led to subscriptions to the IPO also demonstrates that virtual meetings can be just as impactful, even when they involve complex negotiations," said CEO Odd Sverre Østlie. Pexip competes with Zoom (NASDAQ:ZM) and Bluejeans (NYSE:VZ), and says its video conferencing software is used by the U.S. military and the German government.

Only an hour

Social media companies will now have only one hour to delete content related to pedophilia and terrorism, according to a new French law, or face a fine of up to 4% of their global revenue. For other "manifestly illicit" content, companies like Facebook (NASDAQ:FB), Twitter (NYSE:TWTR), YouTube (GOOG, GOOGL), Instagram and Snapchat (NYSE:SNAP) will have 24 hours to remove it. It's the latest legislation by Paris against tech giants. Earlier this year, France passed a controversial "digital tax," though its implementation was delayed as the country worked out a broader international tax agreement.

Mortgage payment deferral

The Freddie Mac (OTCQB:FMCC) COVID-19 Payment Deferral solution returns a homeowner's monthly mortgage payments to their pre-COVID amount by adding up to 12 months of missed payments, including escrow advances, to the end of the mortgage terms without accruing any additional interest or late fees. This will help borrowers keep their mortgage payment current following their hardship when other options - such as reinstatement, or a repayment plan - are not viable. Fannie Mae (OTCQB:FNMA) also unveiled a COVID-19 payment deferral option that allows homeowners in forbearance due to the pandemic to shift their missed payments to the end of the loan term.

Intelsat files for bankruptcy

Weighed down by roughly $14.5B in debt, satellite operator Intelsat (NYSE:I) has filed for bankruptcy protection. It's seeking to use the Chapter 11 proceedings to assist it in taking advantage of a planned auction of a swath of spectrum currently being used by satellite operators that the FCC wants to be repurposed for 5G networks. In order to be eligible to receive $4.87B in accelerated relocation payments, the company needs to spend more than $1B on clearing activities, and it's secured a commitment for $1B in debtor-in-possession financing.

What else is happening...

Airline industry gloom sees GE (NYSE:GE) sink to near three-decade low.

Grubhub (NYSE:GRUB) takeover by Uber (NYSE:UBER) valued at $6B.

NYC lawmakers cap third-party delivery fees.

Fiat (NYSE:FCAU) and Peugeot (OTCPK:PEUGF) say merger on, dividends off.

Tyson (NYSE:TSN) to cut some beef prices as much as 30%.

California Resources (NYSE:CRC) could be on verge of bankruptcy.

Nomura sees cloud boost despite spending slowdown.